Sector: Regional Energos
The Unitrade company has applied to the Federal Anti-Monopoly Service (FAS) for permission to hold 25% plus one share in Bashkirenergo. The company now owns 21.27% in the electricity company. We believe that a strategic investor, wishing to have a say in the company's management, is behind the company's intention to acquire a blocking stake in the power utility.
Unitrade applied to FAS for permission to increase its holding in Bashkirenergo (RTS: BEGY) to 25% plus one share. The agency has deferred its decision for two months on the grounds that the deal potentially breaks anti-monopoly laws.
In late May Unitrade bought its first 21.27% in Bashkirenergo from UES of Russia at an auction for RUB 11 billion. There is no official information on the company's beneficial owners. However, it became known after the auction that Unitrade represents the interests of IES and its partner. A 47.89% stake in Bashkirenergo belongs to Bashkir energy companies, which are controlled by Ural Rakhimov, son of the Bashkir president. The Prosperity Capital Management fund holds a minority share in Bashkirenergo.
It is highly likely that Unitrade seeks to increase its holding in Bashkirenergy to a blocking stake through the buyout of freely floating shares on the market. The scheme chosen to raise the holding is beneficial for the company's minority shareholders, as the buyout would spark a rise in quotations for Bashkirenergo shares on the market. In all likelihood, Unitrade is acting in the interests of a strategic investor, wishing to have a say in the company's management. However, the deal is yet to be approved by FAS.
Our target price for Bashkirenergo (RTS: BEGY) is USD 1.85 per share, which corresponds to a BUY recommendation.
Konstantin Reily
Other comments of the day
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Bashkirenergo
Capitalization: $340 748 270,23
Common shares:
Price: $0,31
Delta week: -21,5%
Delta month: -63,3%
Delta year: -85,0%
Preferred shares:
Price: $0,35
Delta week: -40,4%
Delta month: -2,8%
Delta year: -71,0%
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0.569
0.073
